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Mooya advises against single sourcing over Kasumbalesa

Mooya advises against single sourcing over Kasumbalesa
Written by Joan Chirwa
Thursday, January 08, 2009 2:00:50 AM

GOVERNMENT should allow other bidders to compete for the development of border facilities at Kasumbalesa instead of single sourcing the contractor, Moomba UPND member of parliament Vitalis Mooya has advised.

But transport and communications minster Dora Siliya has defended the decision to single source the contractor for the Kasumbalesa project under a Public Private Partnership (PPP) arrangement, saying it was an accepted procurement method under the Public Procurement Act of 2008.

Mooya yesterday said it would be prudent for the relevant authorities to cancel the agreement made over the development of the Kasumbalesa border facilities in the interest of transparency, as already indicated by the Secretary to the Treasury Dr Likolo Ndalamei. He was commenting on Dr Ndalamei's concerns in his letter to works and supply permanent secretary Lt Col Bizwayo Nkunika, questioning the single sourcing of a contractor for the Kasumbalesa PPP project and advised that the selection process be broadened in line with the PPP policy and for transparency.

“I totally agree with concerns raised by Dr Ndalamei. I fully support him on the idea of not having to single source a contractor for the development of border facilities at Kasumbalesa,” Mooya said. “Yes, the PPP policy was launched and Dr Ndalamei is right when he raises issues of the legal framework. This document first has to come to Parliament in order for it to have a legal backing. But as at now, that has not been done. We followed the same procedure with the transport policy, that's what we have been waiting for in terms of this PPP policy.”

The government last month signed a memorandum of understanding with Baran Trade Limited for the development of border facilities at Kasumbalesa at a cost of US $40 million under the PPP following the launch of the PPP policy on November 27, 2008.

Mooya wondered why the government was in a hurry to implement the PPP policy.

“I don't know why these people are in a hurry to single source the contractor. First of all, how did that contractor get involved? I really fail to understand that,” Mooya said. “It is important to call in other bidders and also to push the PPP policy to Parliament so that it can have a legal backing.”

According to a letter dated December 12, 2008 to Lt Col Nkunika and copied to finance minister Dr Situmbeko Musokotwane and works minister Mike Mulongoti, Dr Ndalamei opposed the idea of single sourcing the contractor for the Kasumbalesa project for the sake of transparency.

“In line with the PPP policy and for transparency, it is important that the selection of the contractor for the Kasumbalesa Border Post is broadened other than single source. The already submitted unsolicited bid should be technically and financially appraised regarding the “Build, Operate and Transfer” PPP arrangement other than grant it under the “single sourcing” aspect,” Dr Ndalamei stated. “It is also important that the issue of guarantees or letters of comfort in upcoming undertakings are clearly agreed considering that government, as stated in earlier correspondence, has a position of not issuing guarantees given the background of the high debt burden and litigations arising from government guaranteeing projects in the past. You may agree with me that guarantees can be purchased on the open market.”

However, in a statement yesterday, Dora Siliya stated that speeding up of the procurement process was necessitated by the continued loss of revenue by the Zambia Revenue Authority (ZRA) at Kasumbalesa border post due to the poor functionality of the present infrastructure.

“The Public Private Partnership policy under the guiding principles, chapter 4 item 4.1.9 provides for unsolicited bids where it states that 'potential PPP projects will not always be known and tendered to the public for submission of bids. It is possible that a PPP project could be initiated by the private sector where no bids have been requested. Such proposal from a developer or investor will be treated as an unsolicited bid'. Government does not stand to lose anything, the only risk government takes is the provision of land,” stated Siliya. “The concessionaire is the one who takes the bigger risk as he is the one investing his money. The concessionaire is not able to take with him anything he builds on the land and thus the government benefits.”

But Mooya said similar projects such as the Kamwala and City Centre markets were good examples where government would not benefit much.

“Those developers were given 65 year leases, and by the time that elapses, those building would have lost their value. I don't know what kind of benefits those are to the government and the people of Zambia,” said Mooya.

Labels: BORDERS, CONTRACTORS, PPPs, VITALIS MOOYA

posted by MrK @ 2:01 AM